K NARAYANASWAMY Vs. DEPUTY DIRECTORENFORCEMENT DIRECTORATEMADRAS

JUDGEMENT

(1.) This appeal is directed against the order of the Foreign Exchange Regulation Appellate Board, upholding the order of the Deputy Director of Enforcement, holding that the appellant has contravened S. 5 (1) (aa) of the Foreign Exchange Regulation Act, 1947 hereinafter referred to as the Act, and imposing a personal penalty of Rs. 5,000/- and confiscation of the sum of Rs. 15,000/ which was taken from the person of the appellant on 10-5-1975 when he was apprehended on suspicion by the Enforcement Directorate.

(2.) The appellant and one Varadaraj were found to carry a sum of Rs. 15,000/ and Rs. 10,000/- respectively when they were apprehended near the Customs House, Madras on 10-5-1973. On suspicion that they were involved in foreign exchange violations, the amounts held by them were seized and statements from each of them were taken. In the statement given by the appellant, dated 10-5-1973 , he has stated that he came to Madras on the instructions of one Manickam Reddiar of Gopalapuram in Virudhunagar and received from one Sri Safeek at No. 42 Moore Street, Madras a sum of Rs. 25,000/- out of which Rs. 10,000/- was given to his friend Varadaraj, who was accompanying him. A similar statement has also been given by Varadaraj, who was carrying the said sum of Rs.10,000/-given by the appellant. On the basis of the statement given by the appellant and Varadaraj, proceedings were initiated against both of them for violation of S. 5(i) (aa) of the Act and for confiscation of the amount recovered from them. We are not now concerned with the proceedings initiated against Varadaraj, but we are concerned only with the proceedings initiated against the appellant. The appellant resisted those proceedings contending that the statement taken from him on 10-5-1973 was under duress, and therefore, the said statement cannot be acted upon. He had also filed a petition on 14-51973 before the Deputy Director of Enforcement, who initiated proceedings, held that the statement given by the appellant and that given by Varadarajan on 10-5-1973 were voluntary and they clearly establish that the appellant is involved in the foreign exchange violation, and therefore, the sum of Rs. 15,000/- has to be confiscated and a personal penalty of Rs. 5,000/- has to be imposed.

(3.) As against the order passed by the Deputy Director of Enforcement imposing a personal penalty of Rs. 5,000/-, an appeal had been filed by the appellant to the Foreign Exchange Regulation Appellate Board. The Appellate Board also agreed with the view taken by the Deputy Director of Enforcement that contravention of S. 5(i) (aa) of the Act has been established in this case.